Section 14 in The Petroleum and Natural Gas Regulatory Board (Authorizing Entities to Lay, Build, Operate or Expand Petroleum and Petroleum Products Pipelines) Regulations, 2010
14. Service obligations of authorized entity (post commissioning).
(1)The, entity shall meet the annual target of transporting petroleum and petroleum products equal to the volume of petroleum and petroleum products quoted in the bid and the Board shall monitor the actual progress in, this regard on a quarterly basis:Provided that non-fulfillment of the annual target by the entity shall result in default and encashment of the performance bond on the following basis, namely:-(a)For the first default:a. ten per cent. of the amount of the performance bond for the default upto ten per cent. of annual target of transporting petroleum and petroleum products;b. twenty per cent. of the amount of the performance bond for the default upto fifty per cent. above ten per cent. of annual target of transporting petroleum and petroleum products;c. twenty five per cent. of the amount of the performance bond for the default above fifty per cent. of annual target of transporting petroleum and petroleum products;(b)For the second default:a. twenty per cent of the amount of the performance bond for the default upto ten per cent. of annual target of transporting petroleum and petroleum products;b. fourty percent to the amount of the performance bond for the default upto fifty per cent. above ten percent of annual target of transporting petroleum and petroleum products;c. fifty percent of the amount of the performance bond for the default above fifty per cent. of annual target of transporting petroleum and petroleum products; -(c)one hundred percent of the amount of the performance bond for the third default:Provided further that the entity shall make good the encashed performance bond in each of the cases at clause (a) to (c) within a week of encashment and in case of not meeting this requirement, the authorization shall be liable for termination.(2)The authorized entity shall not make it conditional to the sourcing of petroleum and petroleum products from itself or its affiliates to any shipper which intends to transport petroleum and petroleum products in the petroleum and petroleum products pipeline.(3)The authorized entity shall give wide publicity of the capacity available in the petroleum and petroleum products pipeline for use on common carrier or contract carrier basis to encourage maximum utifization of the pipeline capacity and shall maintain information in this regard, on its official website, as specified in the relevant regulations on the access code for petroleum and petroleum products pipelines.(4)The capacity available in petroleum and petroleum products pipeline for use as common carrier shall be allocated on the basis specified in the relevant regulations on the access code and declaring petroleum and petroleum products pipelines as contract carrier or common carrier.(5)The authorized entity shall strictly adhere to the provisions under the relevant regulations for affiliate code of conduct right from the stage of submission of the application-cum-bid and onwards including the operative phase of the petroleum and petroleum products pipeline.(6)The authorized entity shall adhere to the requirements of unbundling of the activity of transportation in the petroleum and petroleum products pipeline from the activities of distribution or marketing of petroleum products transported in the petroleum and petroleum products pipeline as and when so decided by the Board.(7)The authorized entity shall be responsible for getting the technical and safety audits carried out by independent technical experts at intervals specified or directed by the Board during the pre-commissioning phase as well as on an on-going basis thereafter to ensure compliance with the relevant regulations for the technical standards and speCifications including safety standards and the audit report along with the findings shall be submitted to the Board for its review and advise of remedial action, if any, to the entity.(8)The third party technical and safety audits shall be carried out by independent technical experts or accredited agencies out of the panel approved by or registered with the Board in compliance with the relevant regulations.
